School quality as a catalyst for bidding wars and new housing development

We provide new evidence of the demand for better schools as manifested in bidding wars and changes to the built environment. Using repeat sales before and after a redistricting, we exploit shocks to school quality arising from the continuous, unexpected redistricting of school attendance boundaries...

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Bibliographic Details
Published in:Real estate economics 2023-07, Vol.51 (4), p.785-818
Main Authors: Liu, Crocker H., Smith, Patrick S.
Format: Article
Language:English
Subjects:
bidding wars
Built environment
construction
housing demand
housing development
Pricing
Residential development
school quality
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Summary:We provide new evidence of the demand for better schools as manifested in bidding wars and changes to the built environment. Using repeat sales before and after a redistricting, we exploit shocks to school quality arising from the continuous, unexpected redistricting of school attendance boundaries in Atlanta. We find that houses redistricted to higher (lower) quality schools are more (less) likely to be involved in a market‐driven bidding war. Similarly, undeveloped, redistricted parcels that receive a positive (negative) school quality shock are more (less) likely to be developed. School quality shocks also have a causal effect on house prices and time‐on‐market.
ISSN:1080-8620
1540-6229
DOI:10.1111/1540-6229.12426